With the Government’s full support and consolidation, the health care system in the territory of Taiwan has implemented National Health Insurance since 1995. The payment system transformed from “fee-for-service” to “prospective payment system” and finally to “global budgets”, and thereby produced a material impact to the health care industry in the territory of Taiwan. According to the statistics of the Department of Health, the number of hospitals has declined from 810 in 1993 to 610 in 2002, with a declination rate of 24.69%. The medical treatment and health care service has a material influence to the public’s health. Meanwhile, due to the particular nature of the industry, it is intervened by governments throughout the world. Though in terms of the organizational theory, it is often defined as a non-profit-making organization in the business of service and its operation is subject to the government’s medical treatment policies and relevant laws. Therefore, notwithstanding that such service does not aim at making a profit as its first priority, it still shall pay attention to the performance to upgrade the quality of service. This study purchased the database for “Report on 1996 and 2001 Industry, Commerce and Service Census Taiwan - Fukien Area, the Republic of China from the Directorate-General of Budget, Accounting and Statistics of the Executive Yuan. Upon selection of the contents of hospitals, we obtained a total of 1,402 research samples. The study result shows that in terms of such indexes as profitability, consolidated asset data, performance of application of assets, cost control and productivity, the ratio of fixed assets appears to be higher prior to the implementation of the National Health Insurance, while the ratio of current assets appears to be lower. Nevertheless, the turnover ratio of current assets appears to be higher upon the implementation of National Health Insurance, while the turnover ratio of fixed assets appears to be lower. Further, the profitability declined by 50% approximately upon the implementation of National Health Insurance, and the ratio of declination in cost was higher than that of increase in income. Upon the implementation of National Health Insurance, it appears that each employee’s expenses were increased, and their productivity was increased relatively. According to the study on the characteristics of hospitals before and after the implementation of National Health Insurance, the implementation of National Health Insurance produced a more significant impact on small-sized hospitals.